Attorney & Mediator
Attorney & Mediator

Agents Under Powers of Attorneys Must Keep Good Records

When acting on another person’s behalf under a Power of Attorney, it is really important to keep good records.  While your own book keeping for your own affairs may be haphazard, you cannot do the same when you are handling another individual’s money.

It is important to maintain copies of all bank statements and financial accounts.  You must keep copies of all invoices paid and have access to cancelled checks to provide verification of where the money is going.

This is important whether you are a friend of the individual or his/her child or parent.  You must be able to prove at a later time that you handled the money with integrity and that all expenditures were proper.

This is an issue that can arise during or after the death of the incapacitated individual.  Family can challenge the manner in which you are and were handling the funds.   After death, there can be a question as to where the money all went and why it is no longer available for the Probate process for distribution to the heirs.

Do not write checks off of your own accounts and then pay yourself back.  You may have the most honest of intentions, however, you are creating a messy paper trail that will lead to suspicion by others.

Keep the accounts straightforward and up to date.  Remember that while you may be a family member or a friend, you have the same fiduciary responsibility to that individual as the bank has to you.